What does the 2016 Federal Budget mean for your small business?

The Federal Budget was handed down last night with changes announced in many areas such as Education, Welfare, Defence & Security, Superannuation and Taxes. Several of our business owners are wondering how the 2016 budget will directly impact small business.

The general consensus is that small businesses are winners in this year’s budget. Eloise Keating of Smart Company writes;

The 2016 budget once again puts small business front and centre, with ongoing tax cuts, incentives to hire young workers and interns, extra funding for the Small Business and Family Enterprise Ombudsman and moves to reform complicated tax regulations.”

The key elements of the budget that will affect small businesses are:

The cutting of the company tax rate to 27.5% for incorporated businesses with a turnover of up to $10million

An increase in the tax discount for unincorporated small businesses from 5% to 8%

An extension of the $20,000 instant asset write-off and other tax concessions for businesses with turnover of up to $10million

Cash bonuses for employers that offer internships and hire eligible young job seekers

A plan to simplify Business Activity Statement reporting requirements

Other changes:

Superannuation

As an employer, the most important thing for you to know is that SuperStream’s introduction on 1 July 2016 isn’t an option or a guideline – it’s the law. Start planning right now to make sure you are SuperStream compliant.

The new ATO tax rates for 2016-2017

It’s important to note that as an employer you’ll need to be using current tax tables to ensure your employees are paying the correct tax rate.

Of course there was much more in the budget, but I have endeavoured to only cover the main issues affecting small business.

With all the changes to income tax rates and superannuation reporting it is your responsibility as an employer to get it right. It is vitally important that your Wages Manager or Cashflow Manager GOLD is up to date as all of the necessary updates including SuperStream will be included in Version 10.

Clients who are current CARE members will have access to their free copy of Version 10 before the new financial year. If you are a current Cashflow Manager client and not a CARE member, call 1300 88 78 68 for special client ‘refresh’ prices.